2018 Budget Hides Massive Cuts in Infrastructure and Dubious Public Service figures

“Getting PNG’s non-resource growth rate back to at least 5 per cent per annum requires more, better quality and better targeted investment in our country’s infrastructure. Recent years have seen massive real cuts in the government’s support for infrastructure of 51% between 2015 and 2018. This is a cause for PNG’s poor growth prospects from 2017 to 2019 – the worst in the Asia-Pacific region according to the World Bank. Port Moresby has received too much infrastructure money, often for grand projects such as APEC Haus, and not enough spending to actually benefit the lives of most of our people” said the Shadow Minister for Treasury & Finance Ian Ling-Stuckey.

“The Alternative Government welcomes the increase in promised infrastructure expenditure in the 2018 Budget and more recent announcements such as Asian Development Bank support for the Highlands Highway. However, there are serious questions about the real priority that infrastructure is getting from the current PNG Government even in 2018.

“PNG’s Department of Works and Implementation has the main responsibility for maintaining and improving our national roads infrastructure. Of the K937m in transport infrastructure, they received K709m or 75% of the transport infrastructure budget. The 2018 budget documents indicate this key department received K710m in 2017, so there was a slight cut even before allowing for inflation.

“However, looking deeper into the budget, we see that the government actually slashed the Department of Works and Implementation in the 2018 budget yet again. Specifically, the government cut the direct PNG programs it was funding from K490m down to K422m. However, the budget documents then assume that donors will make up the entire shortfall – increasing from K219m in 2017 to K286m in 2018. This shows how the government has lost touch with what is required to get the economy growing again, and has simply relied on foreign donors” said Mr Ling-Stuckey.

“Indeed, looking even further into the 2018 Budget papers, we see that there are massive cuts planned in the Department of Works and Implementation. 2018 budget papers indicate that the Department, with staff on strength of 2,263, will have an extraordinary 422 retrenchments and 167 retirements in 2018. That would represent some one-quarter of experienced staff being lost in just one year. These aren’t ‘ghost’ employees – you can’t retrench a ‘ghost’! There is a need to wind back administrative expenses, but this slashing of people in an agency which actually does some work is badly misjudged” said the Shadow Treasurer.

“But of even greater concern when looking at these staffing cutbacks, one gets very worried about fake numbers appearing throughout the 2018 Budget documents. When trying to compare the cuts planned in 2018 with what happened in 2017, we are met with an extraordinary fact. Exactly the same thing happened in 2017 according to budget documents – 422 retrenchments and 157 retirements with a staff outcome of 2,263. Indeed, all numbers for every department on public service establishments is exactly the same as in 2017. Clearly, Department of Treasury (for they are ultimately responsible for the budget documents) simply used the same staffing establishment table from 2017 budget and put it into the 2018 budget without even trying to update any information!

“Treasurer how can we trust any of the figures that appear in the 2018 Budget or your recent premature explanations of what happened in 2017 when such basic errors are being made? Treasurer, is it true that the PNG government now is dependant on donors increasing funding to cover some of the massive cuts in infrastructure spending? Treasurer, in which year did the slashing of vital staff in the Departments of Works and Implementation actually occur? Indeed, given the lack of funding for retrenchments, did it occur?

‘The people of PNG deserve an independent audit of the true state of our economy and of the budget” said Mr Ling-Stuckey.